Transmission question. Goes into neutral inbetween gears.

Hi everybody,

My first post here. These forums look like quite a resource.

I was hoping somebody migh be able to help me out with my T-Bird.
I have a 1985 3.8 that I suspect might have a transmission that's about to take a poop. It's an automatic.

The problem is:
I can feel it going into neutral for a few seconds between gears. So there will be a couple seconds of my engine revving like crazy if my foot is still on the gas, and then it jarringly shifts into the next gear like when you don't have the clutch pushed in all the way on a standard transmission. (But this is an automatic) It doesn't seem to do it, actually, after 3rd gear, but it seems to do it almost all the time when shifting between 1st and 2nd, and often between 2nd and 3rd.

Also, it will feel like it's in neutral for a few seconds when I switch from after I put it into Drive from Park.

I've been avoiding this problem some by manually shifting it from 1st to 2nd, and then into drive, but I don't know how long I can keep doing this.

Prior to this problem, it was doing something that may or may not be related. It was driving on it's own, especially in first and second gears. It felt like the engine was getting a good amount of gas when I was just coasting, so coming up to intersections required a lot more braking than should have been necessary. And when first putting it into drive from park, it would take off, and you would have to slam on the brake if you weren't ready.
Actually, come to think of it, it's still doing this too, but this problem seems overshadowed by the new problem.

Anyway, the transmission is probably 100,000 miles old. It's the 2nd transmission. the T-Bird has 250,000 miles on it.

What would you guys reccomend? If it sounds like a classic failure of the transmission, what should I do?
Any help would be much appreciated. Best Regards,

Jon

Is the fluid level where it should be? Has it been serviced regularly?

Yup,

All fluid levels are at the appropriate levels. Changed oil about 1500 miles ago.

Could use a new air filter. Maybe a new fuel filter, hmmm, but could that really be the cause of this?

Nope. I think the other problem may be a sticking IAC. As for the tranny, my best guess would be something wrong/sticking in the valve body, or possibly a misadjusted TV.